Last month, former SAPPRFT head Zhuang Rongwen took over from Xu Lin as head of the Cyberspace Administration of China, the country’s top internet regulator, as Xu moved to oversee foreign propaganda at the Information Office of the State Council. In a newly published essay, Zhuang laid out what South China Morning Post’s Nectar Gan labeled “an all-encompassing blueprint on how to govern the Chinese internet” bearing the definite imprint of top leader and “internet sage” Xi Jinping.

In the latest edition of Qiushi, or Seeking Truth, the ruling party’s flagship bi-monthly journal on political theory, Zhuang stressed the party’s leadership over the governance of the internet. He pledged to uphold the president’s “core” status and to double down and improve the promotion of Xi Jinping Thought online.

[…] In the article, Zhuang vowed to unite efforts in both promoting “positive energy” – party speak for uplifting propaganda – and suppressing “negative elements”, which Zhuang categorised as “wrong ideological trends” that range from distorting the party, the state or the military’s account of history, negating the party’s leadership or the socialist system, attacking the party’s guidelines and policies to undermining the ideology or image of party leaders, as well as rumours and terrorism-related video or audio.

Zhuang pledged to hold internet tech companies strictly responsible for content management and to speed up the establishment of an overarching nationwide platform for all key internet companies, as well as platforms for the emergency management of public opinion on the internet.

He also called for all internet users to join party members and propagandists to fight a “people’s war” to rehabilitate the “cyber ecology”.

[…] The article is peppered with Xi catchphrases, ranging from “creating a clean and righteous internet space” to the notion of “cyberspace sovereignty”, which sees the internet as a battlefield vital to political stability and national security. [Source]

Chinese e-commerce tycoon Jack Ma used a government-sponsored forum to suggest regulators take a lighter touch in dealing with technology companies, saying the market should be allowed to decide how new industries such as artificial intelligence develop.

“I personally think that the government has to do what the government should do, and the companies do what companies should do,” Mr. Ma said at the World Artificial Intelligence Conference in Shanghai on Monday, recalling a conversation he said he had last year with U.S. Secretary of Transportation Elaine Chao about self-driving cars.

[…] In recent weeks, Tencent Holdings Ltd.’s shares plunged as the government announced its plan to tighten its grip on videogames. Ride-hailing firm Didi Chuxing Technology Co. has come under government scrutiny after police said a driver killed a female passenger, the second since May.

In January, Alibaba’s mobile-payments affiliate Ant Financial Services Group became a target when Chinese internet regulators said the company violated new national standards on the protection of personal data.

Mr. Ma didn’t directly refer to any of those events in his speech, which also included his views on how artificial intelligence could transform businesses and society. Mr. Ma urged traditional industries to embrace new technologies and spoke about how sectors such as manufacturing could be transformed through the use of data. [Source]

Alibaba thrived partly thanks to Mr Ma’s skilful dealings with China’s ruling Communist Party, with which he cultivated both closeness and stand-offishness (“Love them, don’t marry them,” he once said of the government). Under the leadership of President Xi Jinping, however, China’s political system has grown hostile to private businesses that become too big or too disruptive. Officials have constrained bosses’ freedom to make splashy deals. Bytedance, a brash technology firm set up in 2012, has been reined in, and forced to withdraw one of its apps. Its founder issued a grovelling public apology after being chastised by the government. Ant, meanwhile, has seen its aspirations to compete with state-owned banks held back by regulators (see article).

China is putting its corporate champions at the service of its ambitions to compete globally in high-tech industries. Alibaba’s task is to use artificial intelligence to improve cities. Through state-backed venture-capital funds, the government is pouring money into industries that were once the preserve of the private sector. Rumours occasionally surface that it plans to take stakes and board seats in big tech firms. All this has fed growing international suspicion of China, especially in America. Mr Ma was one of the first out of the blocks to congratulate President Donald Trump on his election victory; this year America prevented Ant’s purchase of MoneyGram, a money-transfer firm, on national-security grounds. The reality was always more complicated, but Mr Ma embodies an idea of China as market-driven and open. That idea has faded.

[… I]t is harder to be as disruptive today as Mr Ma was 20 years ago. That is partly because his own creation is so dominant. Increasingly, however, the greatest obstacle to disruption is China’s rulers. The party is intent on having a say much earlier in the development of industries that it considers important. As a result, China is unlikely to see new business leaders with the boldness and brio to match Mr Ma. [Source]

At the event, economist Tyler Cowen asked, “What are the chances that the internet fragments over the years?” Schmidt said:

“I think the most likely scenario now is not a splintering, but rather a bifurcation into a Chinese-led internet and a non-Chinese internet led by America.

[…] If you think of China as like ‘Oh yeah, they’re good with the Internet,’ you’re missing the point. Globalization means that they get to play too. I think you’re going to see fantastic leadership in products and services from China. There’s a real danger that along with those products and services comes a different leadership regime from government, with censorship, controls, etc.

Look at the way BRI works – their Belt and Road Initiative, which involves 60-ish countries – it’s perfectly possible those countries will begin to take on the infrastructure that China has with some loss of freedom.” [Source]

According to three sources familiar with the incident, Google leadership discovered the memo and were furious that secret details about the China censorship were being passed between employees who were not supposed to have any knowledge about it. Subsequently, Google human resources personnel emailed employees who were believed to have accessed or saved copies of the memo and ordered them to immediately delete it from their computers. Emails demanding deletion of the memo contained “pixel trackers” that notified human resource managers when their messages had been read, recipients determined.

The Dragonfly memo reveals that a prototype of the censored search engine was being developed as an app for both Android and iOS devices, and would force users to sign in so they could use the service. The memo confirms, as The Intercept first reported last week, that users’ searches would be associated with their personal phone number. The memo adds that Chinese users’ movements would also be stored, along with the IP address of their device and links they clicked on. It accuses developers working on the project of creating “spying tools” for the Chinese government to monitor its citizens.

People’s search histories, location information and other private data, would be sent out of China to a database in Taiwan, the memo states. But the data would also be provided to employees of a Chinese company who would be granted “unilateral access” to the system.

[…] “It’s alarming to hear that such information will be stored and potentially easily shared with the Chinese authorities,” said Patrick Poon, a Hong Kong-based researcher with human rights group Amnesty International. “It will completely put users’ privacy and safety at risk. Google needs to immediately explain if the app will involve such arrangements. It’s time to give the public full transparency of the project.” [Source]